Bitcoin Miners Receive Inflows Of 7,000 BTC, What Does It Mean?

Keshav Verma

2 years ago

3 mins read

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On-chain data shows that Bitcoin miners have recently received net inflows of about 7,000 BTC. Here’s what this may mean for the asset.

Bitcoin Miner Netflow Has Registered A Large Positive Spike

As an analyst in a CryptoQuant post pointed out, Poolin mining pool seems to have been behind most of the recent inflows. The relevant indicator here is the “miner netflow,” which measures the net amount of Bitcoin entering or exiting the wallets of all miners.

When the value of this indicator is positive, these chain validators are now depositing a net number of coins into their addresses. Such a trend can indicate that the miners are accumulating currently, which can be bullish for the price.

On the other hand, values of the metric below zero imply this cohort is taking coins out of their wallets. The main reason why these investors would transfer their coins away from their addresses is for selling-related purposes. Thus, this kind of trend can have bearish implications for the asset.

Now, here is a chart that displays the trend in the Bitcoin miner netflow over the past year and a half:

The value of the metric seems to have been quite elevated during the past day | Source: CryptoQuant

The above graph shows that the Bitcoin miner netflow has observed a pretty large positive spike during the last day or so. With this sharp rise in the indicator, the miners have received 7,000 BTC in their wallets.

This is quite an extraordinary amount, as no other spike has come close during the last one and a half years. Naturally, if these net inflows indicate that the miners have been buying, the cryptocurrency could feel a bullish boost.

In January, for example, the miners participated in some possible buying, as the netflow registered a significant spike. Following these inflows, the price started its rally.

The quant cautions, however, “It is important to note that having such a large influx of BTC into miners’ wallets does not necessarily guarantee a bullish movement in the price of Bitcoin. Similar situations have occurred in the past where there were significant inflows into miners’ wallets, but the price of Bitcoin subsequently declined.”

The analyst also points out that 99% of these net flows seem to have involved just one mining pool in the sector: Poolin. The chart below shows the trend in the combined holdings of the miners in this pool.

Looks like the metric has spiked recently | Source: CryptoQuant

Since the net Bitcoin inflows are mostly to the wallets of this mining pool, it’s unlikely that they represent the sentiment among the wider mining industry, regardless of whether they are a sign of buying or not.

From the chart, it’s visible that last month, following the local top in the asset’s price, Poolin appears to have sold many coins. These latest inflows seem to have merely taken their holdings back to levels close to those from before this selling.

BTC Price

At the time of writing, Bitcoin is trading around $27,800, up 2% in the last week.

The asset has surged during the past couple of days | Source: BTCUSD on TradingView

Featured image from iStock.com, charts from TradingView.com, CryptoQuant.com

Keshav Verma

Keshav is currently a senior writer at NewsBTC and has been attached to the website since June 14, 2021.

Keshav has been writing for many years, first as a hobbyist and later as a freelancer. He has experience working in a variety of niches, even fiction at one point, but the cryptocurrency industry has been the longest he has been attached to.

In terms of official educational qualifications, Keshav holds a bachelor’s degree in Physics from one of the premier institutes of India, the University of Delhi (DU). He started the degree with an aim of eventually making a career in Physics, but the onset of COVID led to a shift in plans. The virus meant that the college classes had to be delivered in the online-mode and with it came free time for him to explore other passions.

Initially only seeking to make some beer money, Keshav unexpectedly landed clients offering real projects, after which there was no looking back. Writing was something he had always enjoyed and to be able to do it for a living was like a dream come true.

Keshav completed his Physics degree in 2022 and has been focusing on his writing career since, but that doesn’t mean his passion for Physics has ended. He eventually plans to re-enter university to obtain a masters degree in the same field, but perhaps only to satiate his own interest rather than for using it as a means to find employment..

Keshav has found blockchain and its concepts fascinating ever since he started going down the rabbit-hole back in 2020. On-chain analysis in particular has been something he likes to research more about, which is why his NewsBTC pieces tend to involve it in some form.

Being of the science background, Keshav likes if concepts are clear and consistent, so he generally explains the indicators he talks about in a bit of detail so that the readers can perhaps come out having understood and learnt something new.

As for hobbies, Keshav is super into football, anime, and videogames. He enjoys football not only as a watcher, but also as a player. For games, Keshav generally tends towards enjoying singleplayer adventures, with EA FC (formerly FIFA) being the only online game he is active in. Though, perhaps due to being ultra-focused on the game, he is today a semi-pro on the EA FC scene, regularly participating in tournaments and sometimes even taking back prize money.

Because of his enthusiasm for anime and games, he also self-learned Japanese along the way to consume some of the untranslated gems out there. The skill didn’t merely remain as just a hobby, either, as he put it to productive use during his exploration for small-time gigs at the start of COVID, fulfilling a couple of Japanese-to-English translation jobs.

Keshav is also big into fitness, with agility and acceleration-related workouts making a big part of his program due to the relevance they have in football. On top of that, he also has a more traditional strength based program for the gym, which he does to maintain an overall fitness level of his body.

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